Wynn Resorts Results

Wynn Resorts, Limited Reports Third Quarter 2016 Results

Net revenues were $1.11 billion for the third quarter of 2016, an increase of 11.4%, or $113.5 million, from $996.3 million for the same period of 2015. The increase was the result of $164.6 million from Wynn Palace and an increase of $15.9 million from our Las Vegas Operations, partially offset by a decrease of $67.0 million from Wynn Macau.

Wynn Resorts, Limited (Nasdaq: WYNN) today reported financial results for the third quarter ended September 30, 2016. The reported financial results include 40 days of operations of Wynn Palace, which opened on August 22, 2016.

Net revenues were $1.11 billion for the third quarter of 2016, an increase of 11.4%, or $113.5 million, from $996.3 million for the same period of 2015. The increase was the result of $164.6 million from Wynn Palace and an increase of $15.9 million from our Las Vegas Operations, partially offset by a decrease of $67.0 million from Wynn Macau.

On a U.S. GAAP basis, net loss attributable to Wynn Resorts, Limited was $17.4 million, or $0.17 per diluted share, for the third quarter of 2016, a decrease of 118.1%, or $113.6 million, from net income attributable to Wynn Resorts, Limited of $96.2 million, or $0.95 per diluted share, for the same period of 2015. Adjusted net income attributable to Wynn Resorts, Limited (1) was $76.2 million, or $0.75 per diluted share, for the third quarter of 2016, compared to $87.6 million, or $0.86 per diluted share, for the same period of 2015.

Adjusted Property EBITDA (2) was $305.4 million for the third quarter of 2016, an increase of 9.1%, or $25.5 million, from $279.9 million for the same period of 2015, primarily a result of $25.5 million from Wynn Palace.

Wynn Resorts, Limited also announced today that the Company has approved a cash dividend of $0.50 per share, payable on November 29, 2016 to stockholders of record as of November 17, 2016.

Wynn Macau

Net revenues from Wynn Macau were $518.1 million for the third quarter of 2016, an 11.5% decrease from $585.1 million for the same period of 2015. Adjusted Property EBITDA from Wynn Macau was $151.0 million for the third quarter of 2016, a 7.3% decrease from $162.8 million for the same period of 2015.

Casino revenues from Wynn Macau were $488.3 million for the third quarter of 2016, a 10.9% decrease from $547.9 million for the same period of 2015. Table games turnover in VIP operations was $10.94 billion, a 10.5% decrease from $12.22 billion for the third quarter of 2015. VIP table games win as a percentage of turnover (calculated before commissions) was 3.34%, above the expected range of 2.7% to 3.0% and the 3.17% we experienced for the third quarter of 2015. Table drop in mass market operations was $1.11 billion, a 7.6% decrease from $1.20 billion for the third quarter of 2015. Table games win in mass market operations was $205.2 million, a 12.6% decrease from $234.7 million for the third quarter of 2015. Table games win percentage in mass market operations was 18.6%, below the 19.6% experienced for the third quarter of 2015. Slot machine handle was $681.6 million, a 17.4% decrease from $824.6 million for the third quarter of 2015, while slot win decreased 30.0% to $29.3 million.

Non-casino revenues before promotional allowances from Wynn Macau were $63.7 million for the third quarter of 2016, a 17.4% decrease from the $77.1 million for the same period of 2015. Room revenues decreased 14.6%, to $26.2 million for the third quarter of 2016, compared to $30.7 million for the same period of 2015. Our average daily rate ("ADR") was $270, a 14.8% decrease from $317 for the third quarter of 2015. Occupancy declined to 95.1% for the third quarter of 2016, from 95.9% for the same period of 2015. Revenue per available room ("REVPAR") was $257, a 15.5% decrease from $304 for the third quarter of 2015.

Wynn Palace

On August 22, 2016, the Company opened Wynn Palace, an integrated resort in the Cotai area of Macau. Wynn Palace features a luxury hotel tower with 1,706 guest rooms, suites and villas, approximately 500,000 square feet of casino space, 10 food and beverage outlets, approximately 40,000 square feet of lounge and meeting space, approximately 105,000 square feet of retail space, and public attractions including a performance lake and floral art displays, and recreation and leisure facilities.

Prior to the opening of Wynn Palace, the Gaming Inspection and Coordination Bureau of Macau authorized 100 new table games for operations at Wynn Palace with 25 additional table games authorized for operation on each of January 1, 2017 and 2018 for a total of 150 new table games in the aggregate. We transferred 250 table games from Wynn Macau for operation at Wynn Palace.

Net revenues and Adjusted Property EBITDA from Wynn Palace were $164.6 million and $25.5 million, respectively, for the third quarter of 2016.

Casino revenues from Wynn Palace were $146.7 million for the third quarter of 2016. In VIP operations, table games turnover was $4.15 billion and table games win as a percentage of turnover (calculated before commissions) was 2.90%, within the expected range of 2.7% to 3.0%. In mass market operations, table drop was $275.9 million, table games win was $51.5 million and table games win percentage was 18.7%. Slot machine handle was $204.5 million and slot machine win was $12.6 million for the third quarter of 2016.

Non-casino revenues before promotional allowances from Wynn Palace were $33.9 million for the third quarter of 2016. Room revenues were $14.2 million with an ADR of $287, occupancy of 70.8% and REVPAR of $203.

As of September 30, 2016, the total Wynn Palace investment for the Company was $4.4 billion. This reflects a $300 million increase to the guaranteed maximum price ("GMP") under the GMP contract, pursuant to a final agreement that was reached on October 28, 2016, between the Company and the general contractor to fully settle all claims at this time under the GMP contract.

Las Vegas Operations

Net revenues from our Las Vegas Operations were $427.1 million for the third quarter of 2016, a 3.9% increase from $411.2 million for the same period of 2015. Adjusted Property EBITDA from our Las Vegas Operations was $128.9 million, a 10.1% increase from $117.1 million for the third quarter of 2015.

Casino revenues from our Las Vegas Operations were $153.2 million for the third quarter of 2016, a 0.7% increase from $152.1 million for the same period of 2015. Table games drop was $483.4 million, a 1.7% decrease from $491.6 million for the third quarter of 2015. Table games win was $119.4 million, a 2.3% increase from $116.7 million for the third quarter of 2015. Table games win percentage was 24.7%, within the property’s expected range of 21% to 25% and above the 23.7% experienced for the third quarter of 2015. Slot machine handle was $818.7 million, a 7.1% increase from $764.3 million for the third quarter of 2015, while slot win decreased 3.9% to $52.5 million.

Non-casino revenues before promotional allowances from our Las Vegas Operations were $316.3 million for the third quarter of 2016, a 4.2% increase from $303.6 million for the same period of 2015. Room revenues increased 9.1%, to $112.2 million for the third quarter of 2016, compared to $102.8 million for the same period of 2015. ADR was $288, a 4.7% increase from $275 for the third quarter of 2015. Occupancy increased to 90.0% for the third quarter of 2016, from the 88.3% experienced for the same period of 2015. REVPAR was $259, a 6.6% increase from $243 for the third quarter of 2015. Food and beverage revenues increased 1.8%, to $145.2 million for the third quarter of 2016, compared to the same period of 2015. Entertainment, retail and other revenues increased 1.1%, to $58.9 million for the third quarter of 2016, compared to the same period of 2015.

Wynn Boston Harbor Project in Massachusetts

In November 2014, the Company was awarded a gaming license to develop and construct Wynn Boston Harbor, an integrated resort in Everett, Massachusetts, adjacent to Boston. Wynn Boston Harbor will be located on a 33-acre site along the Mystic River and will contain a hotel, a waterfront boardwalk, meeting space, casino space, a spa, retail offerings and food and beverage outlets. The total project budget, including construction costs, capitalized interest, pre-opening costs and land costs, is estimated to be between $1.9 billion and $2.1 billion. During the third quarter of 2016, we commenced construction activities and continue with site remediation and site preparation. We expect to open Wynn Boston Harbor in the first half of 2019.

Total debt outstanding at the end of the quarter was $9.44 billion, including $4.16 billion of Macau related debt, $3.17 billion of Wynn Las Vegas debt and $2.11 billion at the parent company and other.

Non-GAAP Financial Measures

(1) “Adjusted net income attributable to Wynn Resorts, Limited” is net income (loss) attributable to Wynn Resorts, Limited before pre-opening costs, property charges and other, change in interest rate swap fair value, change in Redemption Note fair value, loss on extinguishment of debt, net of noncontrolling interest and taxes calculated using the specific tax treatment applicable to the adjustments based on their respective jurisdictions. Adjusted net income attributable to Wynn Resorts, Limited and adjusted net income attributable to Wynn Resorts, Limited per diluted share are presented as supplemental disclosures to financial measures in accordance with U.S. generally accepted accounting principles ("GAAP") because management believes that these non-GAAP financial measures are widely used to measure the performance, and as a principal basis for valuation, of gaming companies. These measures are used by management and/or evaluated by some investors, in addition to income and earnings per share computed in accordance with GAAP, as an additional basis for assessing period-to-period results of our business. Adjusted net income attributable to Wynn Resorts, Limited and adjusted net income attributable to Wynn Resorts, Limited per diluted share may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

(2) “Adjusted Property EBITDA” is net income (loss) before interest, taxes, depreciation and amortization, pre-opening costs, property charges and other, management and license fees, corporate expenses and other (including intercompany golf course and water rights leases), stock-based compensation, loss on extinguishment of debt, change in interest rate swap fair value, change in Redemption Note fair value and other non-operating income and expenses, and includes equity in income (loss) from unconsolidated affiliates. Adjusted Property EBITDA is presented exclusively as a supplemental disclosure because management believes that it is widely used to measure the performance, and as a basis for valuation, of gaming companies. Management uses Adjusted Property EBITDA as a measure of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors, as well as a basis for determining certain incentive compensation. The Company also presents Adjusted Property EBITDA because it is used by some investors as a way to measure a company’s ability to incur and service debt, make capital expenditures and meet working capital requirements. Gaming companies have historically reported EBITDA as a supplement to GAAP. In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including Wynn Resorts, Limited, have historically excluded from their EBITDA calculations pre-opening expenses, property charges, corporate expenses and stock-based compensation, that do not relate to the management of specific casino properties. However, Adjusted Property EBITDA should not be considered as an alternative to operating income as an indicator of the Company’s performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure determined in accordance with GAAP. Unlike net income, Adjusted Property EBITDA does not include depreciation or interest expense and therefore does not reflect current or future capital expenditures or the cost of capital. The Company has significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, taxes and other non-recurring charges, which are not reflected in Adjusted Property EBITDA. Also, Wynn Resorts’ calculation of Adjusted Property EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

The Company has included schedules in the tables that accompany this release that reconcile (i) net income (loss) attributable to Wynn Resorts, Limited to adjusted net income attributable to Wynn Resorts, Limited, (ii) operating income to Adjusted Property EBITDA, and (iii) Adjusted Property EBITDA to net income (loss) attributable to Wynn Resorts, Limited.

WYNN RESORTS, LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

Operating revenues:

Casino

$

788,219

$

700,014

$

2,263,608

$

2,240,321

Rooms

152,608

133,460

431,047

405,427

Food and beverage

167,997

160,283

469,072

477,312

Entertainment, retail and other

93,230

87,008

257,256

264,843

Gross revenues

1,202,054

1,080,765

3,420,983

3,387,903

Less: promotional allowances

(92,232

)

(84,480

)

(255,119

)

(258,922

)

Net revenues

1,109,822

996,285

3,165,864

3,128,981

Operating costs and expenses:

Casino

505,620

445,167

1,428,532

1,435,755

Rooms

40,188

37,293

115,937

111,563

Food and beverage

109,333

101,161

294,480

288,519

Entertainment, retail and other

40,153

39,263

116,126

118,554

General and administrative

144,206

116,639

381,156

352,546

(Benefit) provision for doubtful accounts

(2,368

)

2,885

816

13,266

Pre-opening costs

70,778

19,467

150,496

52,433

Depreciation and amortization

106,467

80,649

264,187

245,428

Property charges and other

18,514

987

31,366

3,963

Total operating costs and expenses

1,032,891

843,511

2,783,096

2,622,027

Operating income

76,931

152,774

382,768

506,954

Other income (expense):

Interest income

3,678

1,465

9,940

4,655

Interest expense, net of amounts capitalized

(79,669

)

(74,079

)

(193,698

)

(227,298

)

Change in interest rate swap fair value

1,168

(1,287

)

(1,693

)

(7,010

)

(Increase) decrease in Redemption Note fair value

(22,218

)

47,488

(19,239

)

47,488

Loss on extinguishment of debt

—

(5,971

)

—

(126,004

)

Equity in income (loss) from unconsolidated affiliates

—

(2

)

16

68

Other

899

459

(1,046

)

1,790

Other income (expense), net

(96,142

)

(31,927

)

(205,720

)

(306,311

)

Income (loss) before income taxes

(19,211

)

120,847

177,048

200,643

Provision for income taxes

(120

)

(7,418

)

(1,145

)

(23,913

)

Net income (loss)

(19,331

)

113,429

175,903

176,730

Net (income) loss attributable to noncontrolling interest

1,894

(17,219

)

(47,728

)

(68,661

)

Net income (loss) attributable to Wynn Resorts, Limited

$

(17,437

)

$

96,210

$

128,175

$

108,069

Basic and diluted income per common share:

Net income (loss) attributable to Wynn Resorts, Limited:

Basic

$

(0.17

)

$

0.95

$

1.26

$

1.07

Diluted

$

(0.17

)

$

0.95

$

1.26

$

1.06

Weighted average common shares outstanding:

Basic

101,439

101,161

101,423

101,151

Diluted

101,439

101,581

101,835

101,708

Dividends declared per common share:

$

0.50

$

0.50

$

1.50

$

2.50

WYNN RESORTS, LIMITED AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO WYNN RESORTS, LIMITED

(dollars in thousands, except for win per unit per day, ADR and REVPAR)

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

Macau Operations:

Wynn Macau:

VIP:

Average number of table games

142

228

171

243

VIP turnover

$

10,941,100

$

12,218,445

$

36,252,239

$

44,883,114

VIP table games win

$

365,047

$

387,082

$

1,214,675

$

1,320,650

VIP table games win as a % of turnover

3.34

%

3.17

%

3.35

%

2.94

%

Table games win per unit per day (1)

$

28,003

$

18,422

$

25,871

$

19,953

Mass market:

Average number of table games

201

225

228

221

Table drop (2)

$

1,105,938

$

1,196,940

$

3,489,272

$

3,672,269

Table games win

$

205,179

$

234,697

$

687,876

$

722,877

Table games win %

18.6

%

19.6

%

19.7

%

19.7

%

Table games win per unit per day (1)

$

11,089

$

11,319

$

11,008

$

11,988

Average number of slot machines

804

738

787

698

Slot machine handle

$

681,552

$

824,646

$

2,584,342

$

2,891,818

Slot machine win

$

29,327

$

41,876

$

113,098

$

140,791

Slot machine win per unit per day (3)

$

396

$

617

$

524

$

739

Room statistics:

Occupancy

95.1

%

95.9

%

93.8

%

96.6

%

ADR (4)

$

270

$

317

$

304

$

323

REVPAR (5)

$

257

$

304

$

286

$

312

Wynn Palace (6):

VIP:

Average number of table games

72

—

72

—

VIP turnover

$

4,150,448

$

—

$

4,150,448

$

—

VIP table games win

$

120,455

$

—

$

120,455

$

—

VIP table games win as a % of turnover

2.90

%

—

%

2.90

%

—

%

Table games win per unit per day (1)

$

42,117

$

—

$

42,117

$

—

Mass market:

Average number of table games

274

—

274

—

Table drop (2)

$

275,898

$

—

$

275,898

$

—

Table games win

$

51,525

$

—

$

51,525

$

—

Table games win %

18.7

%

—

%

18.7

%

—

%

Table games win per unit per day (1)

$

4,702

$

—

$

4,702

$

—

Average number of slot machines

1,132

—

1,132

—

Slot machine handle

$

204,515

$

—

$

204,515

$

—

Slot machine win

$

12,610

$

—

$

12,610

$

—

Slot machine win per unit per day (3)

$

279

$

—

$

279

$

—

Room statistics:

Occupancy

70.8

%

—

%

70.8

%

—

%

ADR (4)

$

287

$

—

$

287

$

—

REVPAR (5)

$

203

$

—

$

203

$

—

WYNN RESORTS, LIMITED AND SUBSIDIARIES

SUPPLEMENTAL DATA SCHEDULE

(dollars in thousands, except for win per unit per day, ADR and REVPAR)

(continued)

Three Months Ended September 30,

Nine Months Ended September 30,

2016

2015

2016

2015

Las Vegas Operations:

Average number of table games

234

230

236

234

Table drop (2)

$

483,382

$

491,616

$

1,385,963

$

1,574,537

Table games win

$

119,388

$

116,655

$

340,572

$

351,647

Table games win %

24.7

%

23.7

%

24.6

%

22.3

%

Table games win per unit per day (1)

$

5,552

$

5,505

$

5,264

$

5,502

Average number of slot machines

1,890

1,861

1,888

1,861

Slot machine handle

$

818,719

$

764,263

$

2,286,559

$

2,238,594

Slot machine win

$

52,460

$

54,614

$

150,786

$

154,041

Slot machine win per unit per day (3)

$

302

$

319

$

291

$

303

Room statistics:

Occupancy

90.0

%

88.3

%

85.7

%

86.6

%

ADR (4)

$

288

$

275

$

298

$

282

REVPAR (5)

$

259

$

243

$

255

$

244

(1) Table games win per unit per day is shown before discounts and commissions, as applicable.

(2) In Macau, table drop is the amount of cash that is deposited in a gaming table’s drop box plus cash chips purchased at the casino cage. In Las Vegas, table drop is the amount of cash and net markers issued that are deposited in a gaming table’s drop box.

(3) Slot machine win per unit per day is calculated as gross slot win minus progressive accruals and free play.

(4) ADR is average daily rate and is calculated by dividing total room revenues including the retail value of promotional allowances (less service charges, if any) by total rooms occupied including complimentary rooms.

(5) REVPAR is revenue per available room and is calculated by dividing total room revenues including the retail value of promotional allowances (less service charges, if any) by total rooms available.

(6) Wynn Palace opened on August 22, 2016.

Logos, product and company names mentioned are the property of their respective owners.

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